Tax Liens in Lakewood, California
In Lakewood, California, a "lien" is a security interest placed on a piece of property, normally land or a house, to secure the payment of a debt. It typically gives a creditor the right to take ownership of any equity that exists in the property, to secure the payment of the debt. If the owner sells the property, the creditor may also be entitled to the proceeds of the sale, up to the amount owed. It can also give the holder of the lien a higher priority status, giving them an advantage over competing creditors, if the debtor files bankruptcy.
A "tax lien," then, is a lien held by the government to collect a tax-related debt from a private entity, such as a person or corporation in Lakewood, California.
Tax liens in Lakewood, California are ineffective if the taxpayer doesn't have any property to place the lien on. However, essentially any property, including that which the taxpayer obtains after the lien goes into effect, can be affected by a tax lien.
Tax Lien Procedure in Lakewood, California
The actual process of setting up a Lakewood, California tax lien is normally pretty simple. The agency responsible for collecting taxes must first determine that a tax lien is warranted, normally by finding that the debtor owes a significant amount of back taxes.
At this point, the taxpayer will receive a letter containing a "notice and demand," which, as the name suggests, gives notice that the recipient owes taxes, and demands immediate payment. It will normally give the taxpayer about 10 days to pay the demanded amount.
If the deadline passes without payment, most tax liens in California take effect automatically, giving the tax collectors all of the rights in your property that any other lien holder would have.
However, in Lakewood, California, and anywhere else in America, a tax lien only lasts for 10 years, and then it automatically expires. If the IRS fails to exercise the substantial rights that it has under a tax lien within that period of time, it is assumed that they never intend to do so, and the lien will cease to exist. This ensures that valuable property is only kept out of the economy for a certain period of time.
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How Can a Lakewood, California Tax Lien Lawyer Help?
If you are notified by the government that you owe back taxes in California, and that they are going to pursue a tax lien to collect their money, things can get very convoluted, extremely quickly.
Accordingly, if you think that any piece of property you own might become subject to a tax lien in Lakewood, California, you should not hesitate to seek the advice of a qualified tax attorney immediately.